Company Number: 13644066

Analysis Date: 2025-07-20 14:20 UTC

Financial Health Assessment for PSA Financial Planning Ltd (as at 30 September 2024)

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1. Financial Health Score: B

Explanation:
PSA Financial Planning Ltd exhibits a solid financial position with healthy net current assets, positive shareholders’ funds, and growth in both fixed and current assets over the past years. While the company is micro-sized and relatively young (incorporated in 2021), the upward trend in net assets and liquidity suggests growing financial stability. However, the modest share capital and reliance on current assets indicate areas for potential strengthening, hence a B rather than an A.

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2. Key Vital Signs:

Metric	2024 Value (£)	Interpretation
Fixed Assets	18,141	Increase from £5,000 in 2023; indicates investment in long-term resources (e.g., equipment).
Current Assets	60,760	Significant increase from £26,338 in 2023; suggests improved liquidity and operational cash.
Current Liabilities	34,755	Increased from £15,995 in 2023; some increase in short-term obligations to monitor.
Net Current Assets	26,005	Healthy positive working capital, more than doubling from prior year; good short-term health.
Total Assets Less Current Liabilities	44,146	Substantial growth from £15,343 in 2023; strong balance sheet improvement.
Shareholders’ Funds	44,146	Reflects net worth; strong increase consistent with asset growth, signaling retained profits.
Share Capital	£4.00	Very low nominal capital; common for micro companies but limits equity buffer.
Employees	2	Small team size consistent with micro status; manageable overheads.

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3. Diagnosis:

PSA Financial Planning Ltd shows the symptoms of a financially healthy and growing micro enterprise. The company has a healthy cash flow symptom demonstrated by significant increases in current assets, which is a vital sign of operational liquidity and the ability to meet short-term liabilities comfortably. The strengthening balance sheet symptom is evident with increasing net assets and shareholders’ funds, reflecting retained earnings or capital injections supporting growth.

The increase in fixed assets suggests investment in business infrastructure or tools, which is a positive sign of preparing for future scalability. The rise in current liabilities should be monitored but is currently well covered by net current assets, indicating no immediate liquidity distress.

The nominal share capital is very low (£4), which is typical for start-ups but means financial resilience in the event of shocks depends heavily on earnings and asset growth rather than capital buffers.

Overall, the company appears to be in good financial health, with no signs of distress or liquidity issues. The business is in the growth phase, with increasing resources and equity backing.

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4. Recommendations:

• Enhance Capital Buffer: Consider increasing share capital or retaining more earnings to strengthen equity base and provide a cushion against unexpected downturns.
• Monitor Liabilities: Keep a close watch on the rising current liabilities; ensure that short-term debts do not outpace liquidity improvements.
• Cash Flow Management: Continue to maintain healthy cash flow and working capital to support operational needs and growth plans.
• Asset Utilisation: Review fixed asset investments to ensure they are optimally contributing to revenue growth and efficiency.
• Growth Strategy: With a stable financial base, explore strategic growth opportunities (e.g., expanding client base, diversifying services) while maintaining financial discipline.
• Compliance and Reporting: Maintain timely filing of accounts and confirmation statements to uphold credibility and avoid penalties.

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